Imploding is just a matter of time. The bigger they are, the harder they fall. It happened in 2000 and 2008. Perhaps this year or next is 3.0. The fullness of time will tell. Excess creates its own demise.

New era rhetoric doesn't wash. Market analyst Bob Farrell's Rule Number Three says "There are no new eras - excesses are never permanent."

Reality has final say. It arrives in its own due course. Often it's when least expected.

On February 22, market analyst Marc Faber said stock markets peaked. At the same time, bonds may rebound. "I think we have made an intermediate top, and it could be a longer-term" one, he believes.

Markets are "significant(ly) overextended." Bullish sentiment is extreme. "Everybody says 'sell bonds, buy equities.' And when everybody thinks alike, one has to be careful."

"(I)t could expose the Federal Reserve to significant capital losses when these holdings (are) unwound."

"Several participants emphasized that the (Open Market) Committee should be prepared to vary the pace of asset purchases, either in response to changes in the economic outlook or as its evaluation of the efficacy and costs of such purchases evolved."

"(A) number of participants stated that an ongoing evaluation of the efficacy, costs, and risks of asset purchases might well lead the Committee to taper or end its purchases before it judged that a substantial improvement in the outlook for the labor market had occurred."

The European Commission predicts back-to-back year declines for the first time. The Financial Times called it a "grim economic picture." At issue is rising unemployment, lower consumer spending, less business spending and investment, and force-fed austerity.

Polyannish forecasts abound. They've been wrong four straight years. Talking head economists lie. They're well paid to do so.

EU leaders haven't accepted reality. Its two biggest pillars are troubled. France suffers from lack of competitiveness. It's economy began to implode. Wealthy business people are leaving. Investment's drying up fast.

Reality is swept under the rug. No one gives a damn. Spain's Prime Minister Mariano Rajoy just warned "There are no green shoots. There is no spring."

Its entire banking system is troubled. So is its sovereign debt. It managed 2012 by tapping 90% of its social security fund to buy it. Over 200 billion euros in new debt must be financed. How remains to be seen. Banks are net sellers. Investors are wary.

Default looks more likely. Doing so will be multiples greater than Lehman's collapse. Things look likely to get ugly. When is anyone's guess. Debt problems aren't solved by adding more of it.

Economist John Williams predicts a massive May dollar sell-off. Other countries will dump them for safer currencies. Collapse he believes may follow.

Washington has weeks to get its fiscal house in order. Williams calculates FY 2012 deficit at $6.9 trillion. That much more was spent than collected in taxes. America is bankrupt he says.

Real growth hasn't occurred for five years. Prior to 2008's financial crisis, consumers compensated for declining incomes by taking on debt.

Banks now freeze credit. Housing values are stagnant. Most Americans have no new revenues sources. Polls show they expect to spend less. It's their only viable choice.

Economies were wrecked in the process. So were millions of lives. People haven't enough to live on. Policymakers plan making things worse. Austerity represents bad economics and moral failure. Let-eat-cake economics doesn't work. It sparks revolutions.

They don't turn out much better. Things often change but stay the same. Europe is sinking. So is the American dream. For most it was largely illusory. Now it's disappearing altogether. A nightmare replaced it.

Cutting back when stimulus is needed is madness. Doing so assures decline. For most people, it's the worst of all possible worlds. Middle class societies are destroyed. Neoserfdom replaces them. Public anger follows.

Social inequality defines immorality. It's also bad economics. Stimulus improves lives. Jobs are created. All boats are lifted. When people have money they spend it. Hard times forces belt-tightening.

Visit his blog site at sjlendman.blogspot.com and listen to cutting-edge discussions with distinguished guests on the Progressive Radio News Hour on the Progressive Radio Network Thursdays at 10AM US Central time and Saturdays and Sundays at noon. All programs are archived for easy listening.